Posts Tagged ‘NFIP’

News Brief: LA Parish Gets Flood Insurance Break

June 13th, 2011 by Iris | Comments Off | Filed in flood insurance

It’s often said that improving property can help save money on insurance, but it’s rare that doing so saves money for an entire neighborhood, and yet, in a sense, that’s exactly what’s happening in Louisiana.

Residents of an unincorporated part of the state, St. Tammany Parish, are going to receive a decrease of $1.9 million in premiums for federal flood insurance, and it’s because the parish’s flood rating has been improved, which translates into an average drop in premiums of 10%.

How did this happen? Well, according to Parish president Kevin Davis, the community has been working very hard on various flood prevention projects.

At the end of the first quarter of this year, there were 35,720 flood insurance policies in place in St. Tammany Parish, at a cost of about $19.7 million a year to the residents.

So far, the federal flood insurance program (NFIP) has paid almost $1 billion in claims there.

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New Flood Reform Bill Due To Appear

April 5th, 2011 by Iris | Comments Off | Filed in flood insurance

Great news from the world of flood insurance: the House Financial Services Subcommittee on Insurance, Housing, and Community Opportunity is scheduled to mark up its last version of the bill to reauthorize and reform the federal flood insurance program tomorrow.

The committee, which is chaired by Representative Judy Biggert (R-IL), launched its NFIP (National Flood Insurance Program) hearings last month. Last Friday, Biggert shared a revised version of the bill, with changes spawned by testimony FEMA administrator (and NFIP overseer) Craig Fugate.

As it currently stands, the Flood Insurance Reform Act of 2011, also known as HR 1309, re-authorizes the program for five years and includes improvements to the way finances are handled and rates are set, as well as increasing the participation of private sector insurers.

Other changes, made last month, include clarifications to the risk mapping standards, and to FEMA’s authority to recommend the rebuilding or demolition of certain properties in order to lessen the financial assistance needed. The bill also requires FEMA to seek proposals from private insurers, and report the results.

Currently, the NFIP is more than $17.75 billion in debt, and much of that is attributed to the hurricanes that devastated the Gulf Coast in 2004 and 2005.

In a statement, Biggert said, “NFIP is deeply in debt, and its current structure simply cannot provide the reliable protection that homes and businesses need without putting taxpayers at extraordinary risk. By putting the program on sound financial footing and encouraging private sector participation within the market, our bill addresses the concerns of homeowners, businesses, industry experts, and taxpayers.”

The flood insurance program‘s last overhaul was in 2004. Since then, it has taken a lot of criticism for under-pricing risk, and promoting development in areas that are known to be flood-prone.

The current authorization for the program expires in September. It is hoped that a new law will be passed by then.

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Iowa Communities Choose to Opt Out of National Flood Insurance Program

July 8th, 2010 by Iris | Comments Off | Filed in flood insurance

Last week, Congress voted to reauthorize the National Flood Insurance Program, and on July 2nd, President Obama signed the extension into law, keeping it active until September 30th, but not everyone is taking advantage of the reinitiated program, especially in Iowa.

According to government officials, only eighteen cities and counties in Iowa have joined the NFIP since the floods that soaked their state two years ago. Why not? Because of paperwork and money.

Specifically, local officials say, the participating communities are required to adopt and enforce flood plain management ordinances in order to reduce damage from future floods, and that process either takes too much red tape, or would increase insurance costs to home- and business owners.

Unless their communities agree to participate in the national flood insurance program, residents of those communities cannot purchase federal flood insurance. This year, 113 Iowa cities and counties within flood hazard areas have chosen not to participate, down from 131 non-participating communities in 2008.

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